ARC 2020 Conference Wrap-up: How IT/OT Integration Helps to Accomplish Digitalization

ARC 2020 Conference Wrap-up: How IT/OT Integration Helps to Accomplish Digitalization
ARC 2020 Conference Wrap-up: How IT/OT Integration Helps to Accomplish Digitalization
The increasing speed of integration of business, engineering, and manufacturing systems was evident at the 2020 ARC Orlando Forum, in Orlando. Focused on the theme, Driving Digital Transformation in Industry and Cities, the February 3-6 event had over 800 attendees from 20 countries representing more than 300 companies, along with many breakout sessions and workshops. 

The event featured multiple tracks and sessions including: Automation Innovations, Safety & Security, Asset Performance Management, Digital Transformation, 3D Printing & Machine Learning, and Smart Cities & Infrastructure. This comprised over 200 industry presenters and panel participants sharing their insights, experiences, and concerns for discussion.

Reflecting the IT/OT integration trend, the 2020 conference had more IT people attending this year’s conference and the vendor showcase featured more IT companies that OT.   Noting this trend, ARC President & CEO Andy Chatha, commented, “I think we are going to continue see more and more IT companies at future forums.”    Many of the presentations illustrated that there are big advantages when companies operate in new, collaborative ways across the whole of the enterprise, in order to create flexible and synchronized manufacturing.

User presentations described how the integration of business & manufacturing systems have been used as a means to achieve the benefits of digitalization.   A common theme from user presentations was the way traditionally siloed organizations are now working collaboratively across departments, including engineering, IT, OT, purchasing, and manufacturing operations, in order to to achieve the benefits of digitalization.
 

Inside the Digital Transformation Journey at DOW

The opening keynote was an insightful presentation by Dow Corporation’s Melanie Kalmar , the Corporate VP, Chief Information Officer &  Chief Digital Officer and Peter Holicki, the Senior Vice President of Operations for Manufacturing and Engineering, which described the company’s digitalization journey.   Both Kalmar and Holicki have over 30 years of experience at Dow and discussed their collaboration journey, which they have seen yield significant results.   They described their joint vision of how IT & OT, working together, is delivering greater benefits to the organization than they did working separately.  The shared goal between both is to become the leading material science company pursuing digital innovation that generates growth for the company.  The digital strategy is based on three important pillars:
  • Getting closer to the customer
  • Making life easier for employees
  • Improving the speed of how work is accomplished 
Holicki described how, initially, the IT and the manufacturing organization had expertise that just wasn’t shared. “We really needed to break down the silos between the two organizations to bring that deep knowledge and expertise together,” he recalled.  He also provided further candid comments on, how in the past, IT and OT worked for a long time alongside each other and had not been interconnected in any way.  In the beginning of the process of trying to work together, Holicki had concerns about the impact of each group’s different work practices and whether the groups were willing to support each other, as he put it, “make room in our agendas and priorities.” 

Kalmar described how her team had to understand how operations work. “In IT, we always thought manufacturing needed some discipline because they always seemed to like the new toys,” Kalmar explained, “Understanding how and why the decisions were made in manufacturing was really important.” 

She also shared how they learned that IT typically takes an enterprise approach, while manufacturing needs to take a more custom approach, with solutions that fit the need of the manufacturing capabilities at each site.  Reflecting on these lessons from their digitalization journey, Kalmar commented, “I would have sent my teams into plants sooner.”
 

Building a Digital Culture

Holicki and Kalmar described their efforts at working together to create a culture, which leveraged what they had in common, in order to build trust so that the teams would be willing to try new things together and even make mistakes, while exploring new ideas.  One of these major common grounds between the IT and OT organizations was a shared focus on delivering improved safety, reliability, and a better customer and employee experience thought the digital space.  Both organizations shared a passion for creating something new and were eager to be pioneers and try new things out.  

An innovation team was created between IT and OT to spearhead integration and find opportunities. When their insights were put into action, these included clear alignment with business goals, processes, strategy, and focused on solving key company challenges.

Results include a holistic digital tread throughout the organization that has led to new valuable insights internally and for customers.

Holicki estimates that Dow now creates 20 billion data points per day from their worldwide plants, a digital achievement that was possible only through successful collaboration with IT.  This includes data points from automated processes, machine sensors, IT systems, and human-derived inputs.  This data is a fundamental part of digital threads that provides insights for innovation and new solutions.
 

Bringing Experienced IT & OT Leaders Together

It is important to note that Melanie Kalmar and Peter Holicki are highly experienced people at their organizations and now sit on the corporate strategy board, where a lot is discussed about digitalization. They also participate in setting priorities for key initiatives. 

Kalmar is responsible for Dow’s global strategy for information technology and digital capabilities including global Information Systems organization, cyber security and risk management, advanced analytics, facilities management, and the Dow Services Business - which provides services beyond Dow - in support of Dow’s merger & acquisition strategy.  Kalmar holds a Bachelor of Science degree in Management Information Systems from Central Michigan University, Mt. Pleasant, Michigan, Executive Education Program at Babson College, and Thunderbird International Leadership Program in Phoenix, Arizona.   She is also president of the Michigan Council for Women in Technology Foundation and a member of the Dean’s Council for Central Michigan University’s School of Business.

Holicki presides over the Operations Leadership Team (OLT) and is accountable for the global Operations organization consisting of more than 22,000 employees across the globe and is a member of Dow’s Leadership Team is responsible for executing the Company strategy in addition to the Operations Team (OT), accountable for the Company’s productivity and performance. He is also a member of the North Star Team chartered to drive Dow’s Customer Experience and Employee Experience to advance the evolution of Dow’s operating model.  He holds a degree in chemical engineering from Fachhochschule M√ľnster, Germany and a Master of Business Administration from Ruhr-Universit√§t Bochum, Germany.
 

The Outcomes for Dow

They shared how their focus was on achieving manufacturing 4.0; to fully digitize all aspects of operations, with efficient digital interfaces to all the other functions in the company.  Manufacturing 4.0 goals include stronger reliability, better quality, increased production, greater profitability, improved safety, manufacturing flexibility, informed decision-making, and enhanced overall competitiveness as a business.  Smart sensors provide real-time information about equipment performance and provide data on production against targets.  Mobile data access provides information to personnel, wherever they are, to identify problems before they escalate and carry out informed corrective actions.  Business and functional leaders have an up-to-date view of real-time performance for decision-making, in order to make more accurate operations and sales plans. The end goal is to result in better inventory management and customer satisfaction delivering the right product to the right place at the right time. 

“ We are really focused on being a real-time company, using and leveraging the data we have to drive better decisions, be a more sustainable company, and a favored company.” Melanie Kalmar, Dow Corporation
They envisioned Dow’s Digital Operation Centers as think tanks for the development and pilot of digital solutions that include supply chain logistics, and process R & D.  Their Digital Operations Center employees have expertise in production, maintenance, process control, and automation, process development, robotics, manufacturing execution systems, enterprise architecture, mobile technologies, and other areas. The multidisciplinary teams performs rapid prototyping of solutions, leveraging new technologies to validate and refine them for broad deployment.
 

Final Thoughts

Most importantly, Kalmar and Holicki believed successful digitalization require alignment starting at the top of the organization. Once that alignment is achieved, executives need to vigorously communicate the strategy to ensure that alignment extends through the entire organization.
“ Working together is the new paradigm and isolated silos will no longer be accepted”.  

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